The Federal Minister for Planning, Development and Reform Khusro Bukhtiyar on Sunday said tax-to-GDP ratio is 11 percent, which will be enhanced to 12.6 percent as no economy can function without having sufficient revenue collection. Taking part in budget debate, he said that the government has set an ambitious revenue collection target of over Rs 5,500 billion, enabling the government to provide 35 percent more funds to provinces under NFC award. He said that in next five years, our focus will be on economic stabilisation with a growth rate of four percent to be enhanced to 6.5 percent of GDP in five years with an average of five percent.
The minister said private investment will be taken to 18 percent from existing 15 percent, adding 10 million jobs will be created in five year terms of the PTI government. Bakhtiyar said Rs 80 billion have been allocated to improve power transmission system, Rs 43 billion for higher education and knowledge economy, and Rs 13 billion for agriculture sector.
He said that the previous government had left $ 20 billion behind as current account deficit, for which the friendly countries provided $ 9.2 billion as budgetary support. He said that for the first time, Pakistan has obtained favourable duty-free access on 313 products to fetch $ 500 million jump in exports at initial stage with implementation on second phase of China Pakistan Free Trade Agreement (CPFTA).
"As a result, the current account deficit will come down to from $ 20 billion to $ 12.15 billion," he added. In order to end the current account deficit, he said the government had to approach the International Monetary Fund (IMF). Criticising the previous governments, he said that those talking about charter of economy, went to IMF for 18 times, but the PTI government will not go to IMF ever again. About foreign debt, he said "the total debt of GDP was 86 percent when PTI took over".
He said Sindh alone will get Rs 200 billion more funds if the revenue target is achieved. He said that at present only 1.9 million people are paying tax which also include 380 companies. He said that the country can not afford to 11 percent of GDP ratio, as we need to take it to at least 15 percent to fulfill our expenditures ie. defence, infrastructure, health, education, etc. "This is the reason we must bring the tax evaders under the tax net as the country can not be run like this," he added.
About the projects under taken through China Pakistan Economic Corridor (CPEC), he said that it is being done on the basis of government to government and BOT (Build, Operate, and Transfer) mode for its early completion. The minister ended his speech by showering praise on PM Khan, saying "Khan has sworn to defend the motherland," and this is the reason, people have voted him into power so that he can steer the country the prevalent economic crises.
Pakistan Muslim League-Nawaz (PML-N) leader Ahsan Iqbal criticised the Pakistan Tehreek-e-Insaf (PTI) government for presenting a federal budget dictated by IMF, saying such budget would plunge millions below the poverty lines and will hinder economic growth. He said that the primary target of a budget should be to achieve economic growth, create job opportunities and make social investments to provide health and education facilities to the people.
He said the government failed to achieve its revenue target due to which budget deficit was increased, adding there was a shortfall of Rs 550 billion in tax collection during the ongoing fiscal year and the current expenditure rose by 20 per cent.
"The gimmickry of selling buffaloes and vehicles cannot control the budget deficit," he remarked in an allusion to PTI's austerity drive under which the government sold buffaloes and cars owned by the PM House. Comparing his government's achievements to that of the PTI's, Ahsan said during the PML-N's tenure, the industry was growing and agriculture was getting revived. He said during their government, Pakistan grew at 5.8 percent, Pakistan Stock Exchange (PSX) was the best in Asia and Pakistani rupee was stable against the US dollar.
Now the country's stock exchange and currency had lost their value and inflation had risen, he noted, adding that with a growth rate of three per cent this year, it would be difficult to create jobs for two million people.
He said PML-N government launched Vision 2025 with the collaboration of chief minister of provinces and different stakeholders. "We implemented the roadmap under the Vision 2025, and in 2017 PricewaterhouseCoopers, a leading firm which ranks economies, said that Pakistan would be among the 20 top economies by 2030 if it continued its growth momentum." He said during PML-N government growth rose from 3 percent to 5.8 percent, inflation came down to single digit, revenue doubled and foreign direct investment (FDI) increased from less than $1bn to $3bn, law and order considerably improved and Pakistan was set to attract foreign investment.
He said that $ 28.5 billion of projects were materialized under CPEC, adding after reports of international institutions about growing Pakistani economy, in 2017 some elements conspired against Pakistan to destabilize it. He said the government had cut the public sector development programme by billions of rupees and reduced funds for different sectors of the economy.
The recent debt commission formed by Prime Minister Imran Khan also came under discussion. The former minister said the PML-N has to show for what it borrowed during its five years.
Iqbal said in the last five years, the PML-N government took loans of Rs 10,000 billion. But from 2013-2018, 12,000 megawatts of electricity was generated, 1750 kilometres of motorways, including Lahore-Multan and Multan-Sukkur section of motorways, were built. "We developed infrastructure which was acknowledged by international financial institutions."
The government should tell where it spent loans of Rs 5,000 billion in its one year, he asked. In a word to advice to the government, he said the politics of allegations and abuses look good on containers, but the treasury benches in parliament will have to show tolerance and responsibility.
Pakistan People's Party (PPP) leader Raja Pervaiz Ashraf said the last PPP government left, the current account deficit was at $ 2.5 billion but now it was about $ 22 billion. He said the parliament was the mother of all institutions and it should be respected. He recalled that the PPP government had given the Gwadar port to China by taking back its control from Singapore, laying the basis for CPEC.
The PPP encouraged farmers and Pakistan achieved self-sufficiency in wheat production, he added. Ashraf reminded that the PPP government faced the challenges of worst floods in the country's history, took back Swat and Malakand from militants, started Benazir Income Support Programme (BISP), and gave jobs to thousands of people and raised salaries and pensions of civil employees and armed forces.
Participating in the debate on the budget, PTI's Amjad Ali Khan said the government had to approach the IMF because the last regime had left behind huge loans and the circular debt. He said the country's economic conditions had deteriorated because assets and properties were made in foreign countries. The main parties in the opposition should tell the nation as to how they had come into power in the past, he added.
Terming the budget as anti-poor, Shahida Akhtar Ali of MMA urged the government to reduce the burden of multiple taxes on people. She expressed concern that the PTI will bring a mini-budget after three months besides approaching IMF for more loans.
Rashid Ahmed Khan of PML-N said subsidy should be provided to the farmers on fertilizers and pesticides. He said PML-N in its tenure added 12,000 megawatts of electricity to the national grid.
Wajiha Akram of PTI said that Pakistan is moving forward on the right track under the leadership of Prime Minister Imran Khan. She said government taking various steps for the welfare of the people.
Tahira Aurangzeb of PML-N said IMF has prepared the budget carries no relief for the general public. She urged the government to adopt recommendations of the opposition in the budget.
Sheikh Rashid Shafique of PTI urged the government to enhance funds for Ghazi-Barotha project. Dr Shahnaz Baloch of Balochistan National Party said that more funds should be allocated for various sectors in Balochistan. She said scholarships for the students and jobs for Baloch youth should be enhanced. She called for need based reforms in health and education sectors. PTI Leader Lal Chand said natural gas, electricity, and clean drinking water to various districts of Sindh should be provided. He also called strict legislation to check forced conversions of Hindu community and protection to minorities.
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